Judge Blocks Kalshi From Offering Prediction Contracts in Nevada
Expertise: US Gaming, European Gaming Industry, iGaming
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US District Judge Andrew Gordon dissolved an injunction issued in April that had allowed Kalshi to keep operating while contesting a cease-and-desist order from Nevada regulators. In his decision, Gordon concluded that Kalshi’s argument for exclusive federal oversight by the Commodity Futures Trading Commission (CFTC) was untenable.
“[Kalshi’s] interpretation would require all sports betting across the country to come within the jurisdiction of the Commodity Futures Trading Commission (CFTC). That interpretation upsets decades of federalism regarding gaming regulation, is contrary to Congress’ intent… and cannot be sustained”, Gordon wrote.
The ruling follows a formal enforcement action from the Nevada Gaming Control Board earlier this year, which said Kalshi’s contracts – allowing wagers on the outcomes of real-world events – fell within the definition of gambling under Nevada law. The state demanded that Kalshi cease offering those products to customers in Nevada pending regulatory approval.
Kalshi has long maintained that its platform, which sells contracts tied to real-world events, is a federally regulated exchange under the Commodity Exchange Act and therefore falls within the CFTC’s exclusive jurisdiction – a position supported by an earlier ruling that favored Kalshi before being overturned in this latest decision. The company argued this created a uniform federal regime for prediction markets and insulated it from state-by-state gaming oversight.
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RELATED TOPICS: Regulation
